Finance Act 2019, PART 1 — Eligibility of individuals and partnerships (1–2) — Full Text

1

(1) Section 43A of VATA 1994 (groups: eligibility) is amended as follows. (2) In subsection (1), in the opening words— (a) for “bodies corporate” substitute “ UK bodies corporate ” ; (b) omit “each is established or has a fixed establishment in the United Kingdom and”. (3) Omit subsections (2) and (3). (4) At the end insert— (4) An individual carrying on a business and one or more UK bodies corporate are eligible to be treated as members of a group if the individual— (a) controls the UK body corporate or all of the UK bodies corporate, and (b) is established, or has a fixed establishment, in the United Kingdom in relation to the business. (5) Two or more relevant persons carrying on a business in partnership (“ the partnership ”) and one or more UK bodies corporate are eligible to be treated as members of a group if the partnership— (a) controls the UK body corporate or all of the UK bodies corporate, and (b) is established, or has a fixed establishment, in the United Kingdom in relation to the business. (6) In this section— (a) “ UK body corporate ” means a body corporate which is established or has a fixed establishment in the United Kingdom; (b) “ relevant person ” means an individual, a body corporate or a Scottish partnership. (7) Section 43AZA contains provision for determining for the purposes of this section whether a body corporate, individual or partnership controls a UK body corporate.

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In that Act, after section 43A insert— Section 43A: control test (43AZA) (1) This section applies for the purposes of section 43A (and expressions used in this section have the same meaning as in that section). (2) A body corporate (“X”) controls a UK body corporate if— (a) X is empowered by statute to control the UK body corporate's activities, or (b) X is the UK body corporate's holding company. (3) An individual (“Y”) controls a UK body corporate if Y would, were Y a company, be the UK body corporate's holding company. (4) Two or more relevant persons carrying on a business in partnership (“ the partnership ”) control a UK body corporate if the partnership would, were it a company, be the UK body corporate's holding company. (5) In this section “ holding company ” has the meaning given by section 1159 of, and Schedule 6 to, the Companies Act 2006.